This chapter explores in detail the OE/S process. We will examine managerial decision making perspectives concerning this process; technologies available to support this process; and various models of this process (DFD's, ERD's, and system flowcharts). Finally the chapter will explore The Control Matrix for this process.
Order Entry / Sales Process Activities:
Pre-Sales Activities- anything that occurs before the sale
Sales Order Processing- activities associated with the actual sale
Picking and Packing Goods- obtaining goods out of inventory (or something similar) and packing them to send to the consumer
Shipping- the process the delivering the goods to the consumer
Order Entry / Sales (OE/S) Process Information Flows: It is the first of the four steps in the order-to-cash process and reflects an interacting structure of people, equipment, methods, and controls that is designed to achieve certain goals. The primary function of the OE/S process is to create information flows that support the following:
1. Repetitive work routines of the sales order department, the credit department, and the shipping department. For example the sales order form often supports repetitve work routine of the sales order department by capturing vital customer and order data or by facilitating the process of granting credit to customers.
2. Decision needs of those who manage various sales and marketing functions.
The horizontal perspective of the Order Entry/Sales process is concerned with how the process relates to the repetitive work routines of the sales order, credit, and shipping departments.
(9), please describe them: There are nine information flows that function as vital communications links among the various operations departments. (p 351) The flows describe the horizontal flow of information between the OE/S process and its organizational environment.
The nine information flows are:
1- Customer places order
2- Sales order department requests credit approval from credit department
3- Credit department informs sales order department of disposition of credit request
4- Sales order department acknowledges order to the customer
5- Sales order department notifies shipping department of sales order
6- Sales order department notifies warehouse and B/AR/CR process of shipment
7- Warehouse sends completed picking ticket to shipping
8- Shipping department informs sales order department of shipment
9- Shipping department informs carrier, B/AR/CR process, and general ledger process of shipment
The vertical perspective of the Order Entry/Sales process is concerned with how the process relates to managerial decision making within the marketing function.
Vertical Information Flows: The flow of information between the operations processes and higher levels of management. The information flows "upward" in the heiarchy. The information at the management level is used for strategic decision making. An example of a vertical information flow associated with the OE/S process is when a sales manager uses an area code taken from a telephone orderto plan an advertising campaign.
Vertical Perspective of the OE/S Process:
Focus on the Customer
There has been expansion of the amount and type of data collected by the OE/S process regarding a firm's customer population. Mass marketing or segmented marketing is being replaced with more personalized marketing to a smaller segment. The ultimate aim is to concentrate on the individual customer, and the outcome is CRM software which is discussed below. Customers are the most important asset of a business. Global competition places more emphasis on the OE/S process.
Mastering Global E-business:
Data warehousing- viewed as focused on either operational or analytical applications:
~ Operational applications: focus on providing decision makers with the information they need to monitor and control their organization.
~ Analytical applications: are intended to allow the use of sophisticated statistical and other analytical software to help an organization's members develop insights about customers, processes and markets.
Includes Data Mining: Ex. Software is installed on a customer database that collects
data, encrypts it, and transfers it to its data center. The data is then cleaned,
installed into a secure data warehouse, and a set of proprietary algorithms are used
to analyze it. Reports are then generated that tell its customers what works & what
doesn't on its web sites & can forecast future customer moves. Link to a website that provides info on how to design, build, and maintain a data warehouse.
Data warehousing (alternate definition) - A data warehouse is a collection of data gathered and organized so that it can easily by analyzed, extracted, synthesized, and otherwise be used for the purposes of further understanding the data. It may be contrasted with data that is gathered to meet immediate business objectives such as order and payment transactions, although this data would also usually become part of a data warehouse.
Data marts- Subsets of an overall warehouse that are customized for a specific department. They are desgined to provide detailed data for a specific set of users while avoiding the costly development and extensive time delays that come from the development of a comprehensie data warehouse.
E-Business systems can be used to penetrate global markets by allowing trading partners and customers to easily process international orders without a physical presence. E-business systems are broken into categories: buy-side and sell-side. ~ Buy-side systems - use the internet to automate and manage corporate venders and purchases. The predominant technology in this area is electronic data interchange (EDI). ~ Sell-side systems - are designed to allow a company to market, sell, deliver, and service goods and services to customers throughout the world via the internet.
One facet of sell-side systems is known as Customer Relationship Management (CRM)applications:
Designed to manage all customer-related data (marketing, field service, contact management data)
Segmentation of customers into categories based on key characteristics - ex. matches sales promotions to customers' buying trends
Better Customer Service equals Happier Customers leading to Greater (repeat) Sales
This facilitates the matching of sales promotions with customers buying trends. This is a particularly crutial area for integration with an existing ERP system because much of the information necessary to support sales analyses comes from data captured during the recording of sales event data in the ERP system. "By combining enterprise systems with buy-side and sell-side applications, an organization can seamlessly conduct e-business across the globe." (text)
Web Services, used to automate buy-side and sell-side enterprise applications: Web Services - is a process and set of protocols for directly connecting enterprise systems over the Internet. Earlier Web protocols are presented by HTTP (HyperText Transfer Protocol), FTP (File Transfer Protocol), and SMTP (Simple Mail Transfer Protocol). Web Services goes one step further and enables communication between computer systems without human intervention. Web Services is, then, a replacement for EDI. But, it is much more in that it is a protocol for interoperation of systems, not just communication between systems. "By combining enterprise systems with buy-side and sell-side a
Web Services relies on three key underlying technologies:
1) Universal Description, Discovery, and Integration (UDDI) - a protocol for registering a business in an Internet directory so that companies can find one another and carry out business over the Web.UDDI website
The UDDI project encourages the inter-operability and adoption of Web services.
It is a partnership among industry and business leaders and was founded by IBM, Ariba, and Microsoft. Now, over 300 companies participate.
UDDI provides a standards-based set of specifications for service description and discovery, as well as a set of Internet-based implementations.
UDDI addresses a number of business problems by broadening and simplifying business-to-business (B2B) interaction.
UDDI provides one-stop shopping for information on businesses and electronic services. Publishing business and service information in UDDI makes it broadly accessible to others.
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> 2) Web Service Description Language (WSDL) is an XML-based format for describing how one software system can connect and utilize the services of another software system over the Internet.
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Figure: How WSDL works:
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> 3) Simple Object Access Protocol (SOAP) is an XML-based protocol for encoding Web Service messages.
There are several different types of messaging patterns in SOAP, but by far the most common is the Remote Procedure Call (RPC) pattern, in which one network node (the client) sends a request message to another node (the server), and the server immediately sends a response message to the client. SOAP is the successor of XML-RPC, though it borrows its transport and interaction neutrality and the envelope/header/body from elsewhere, probably from WDDX.
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Customer Relationship Management (CRM) Systems (recall from Chapter 2):
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> CRM software is designed to manage all the data related to customers, such as marketing, field service, and contract management data. CRM has become the focus of ERP vendors who realize the need to tap into this growing market and to integrate CRM data with the other data already residing within the ERP system's database.
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The concept behind CRM software is that better customer service means happier customers and yields greater sales.
Part of the service concept is field-service support and contact management. The result is that sales person can review all the historical information before calling on a customer and be better prepared to provide that customer with targeted products and services. These systems also support the recording of information about the customer contact (spouse, children, hobbies, etc.), that help facilitate the salesperson in making quality contact with the customer.
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> At the same time, the software supports the organizing and retrieving of information of historical sales activities and promotional planning. This is particularly crucial area for integration with any existing ERP system because much of the information necessary to support sales analyses comes from data captured during the recording of sales event data in the ERP system.
Segementation - key buzzword for CRM; the grouping of customers into categories based on key characteristics.
A third area that is prevalent in CRMs is support for customer service - particularly for phone operators handling customer support call-in centers. The CRM quickly provides the phone operator with information on the customer's history and usually links the operator with a database of solutions for various problems about which a customer may be inquiring
Technical Considerations
The following factors need to be considered:
Scalability: the system should be highly scalable, as the volume of data stored in the system grows over time
1.Communication channels: CRM can interface with a variety of different channels (phone, WAP, Internet etc.)
2. Workflow - a company's business processes need to be represented by the system with the ability to track the individual stages and transfer information between steps
3. Assignment - the ability to assign requests, such as service requests, to a person or group.
4. Database - the means of storing customer data and histories (in a data warehouse)
5. Customer privacy considerations, such as data encryption and legislation.
Control Goals
The control goals for the OE/S proess are no different from the generic goals, except that they have been tailored to the specifics of the OE/S process.
There are two categories of goals:the operations process control goals and the information process control goals.
The operations process control goals are:
- Effectiveness of operations: provide timely response to customer inquiries; provide timely acknowledgment of customer orders; provide assurance of customer's creditworthiness; provide timely shipment of goods to customers.
- Efficient employment of resources: people and computers are the resources found in most business processes.
- Resource security - inventory, customer data are of concern to the OE/S process. Control plans should be in place to prevent theft or unauthorized sale of merchandise inventory. Equally important are plans designed to preclude unauthorized access to or copying, changing, selling or destruction of the customer master data.
The information process control goals are divided into two sections - one section for sales order inputs and a second section for shipping notice inputs. They are:
- Input validity. A valid sales order is one from an existing customer - one contained in the customer master data - whose current order falls within authorized credit limits. If a CSR enters a customer number for which the system has no record, the system rejects the order and the entry is terminated. To be added to the customer master data, a customer should pass an initial credit investigation. By adding the customer to the customer master data, management has provided auhtorization to do business with that customer. Valid shipping notice events are those that are supported by both an approved sales order and an actual shipment of goods.
- Input completeness and input accuracy of sales orders or shipping notices.
- Update completeness and update accuracy of the sales order and inventory master data. The sales order master data is updatd twice - once when a new sales order is created, and later to reflect the shipment of that order. The single inventory master data update occurs at the same time the new sales order is created.
Technologies Supporting OE/S Process:
Data Warehousing - The use of information systems facilities to focus on the collection, organization, integration, and long-term storage of entity-wide data. Data warehousing provides users with easy access to large quantities of varied data from across the organization for the sole purpose of improving decision-making capabilities.
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* Data Marts - A subset of an overall data warehouse customized for a specific department. Data marts are designed to provide detailed data for a specific set of users.
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Data Mining - The exploration, aggregation, and analysis of large quantities of varied data from across the organization to better understand an organization's business processes, trends within these processes, and potential opportunities to improve the effectiveness and / or efficiency of the organization.
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* Customer Relationship Management ([[../../Chapter2 GSH#CRM|CRM]]) Systems - Software that builds and maintains an organization's customer-related data. The concept behind CRM is that better customer service means happier customers and yields greater sales - particularly repeat sales. Parts of the service concept are field service support and contact management. Contact management facilitates the recording and storing of information related to each contact a salesperson has with a client and the context of the conversation or meeting. Additionally, each time the client makes contact regarding queries or service help, this information also is recorded. The result is that salesperson can review all the historical information before calling on a customer and be better prepared to provide that customer with targeted products and services. These systems also support the recording of information about the customer contact such as spouse's name, children, hobbies, etc., that help facilitate the salesperson in making quality contact with the customer. At the same time, the software supports the organizing and retreiving of information on historical sales activities and promotions planning. This facilitates the matching of sales promotions with customer's buying trends. This is a particularly crucial area for integration with any existing ERP system because much of the information necessary to support sales analyses comes from data captured during the recording of sales event data in the ERP system. The buzzword for this CRM application is "segmentation," the grouping of customers into categories based on key characteristics. These categories might represent customers likely to respond to a marketing campaign, high-end customers who should receive "high-touch" customer service, and low-end customers who should be directed to self- service options. A third area that is prevalent in CRMs is support for customer service-particularly for phone operators handling customer support call-in centers. For many organizations, phone operators who have never had previous contact with customers tend to handle the bulk of customer service activities. The CRM quickly provides the phone operator with information on the customer's history and usually links the operator with a database of solutions for various problems about which a customer may be inquiring. These solutions may simply be warranty or contract information, or at a more complex level, solutions to operations or maintenance problems on machinery or equipment. All this information can be efficiently stored for quick retrieval by the system's user.
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Automated Data Entry:
Bar Code Readers - Devices that use light reflection to read differences in bar code patterns in order to identify a labeled item. The most common place for barcode readers are in a grocery and department stores, they are also used extensivly in warehouses for inventory tracking.
Optical Character Recognition - Devices that use light reflection to read handwritten or printed characters. such systems have more difficulty that than bar code readers in consistently reading data both this and bar code readers are designed to eliminate the need for individuals to key data and the accompanying potential risk for error.
Scanners - Input device that captures printed images or documents and converts them into electronic digital signals that can be stored on computer media.
Digital Image Processing - computer based systems for capture, storage, retrieval, and presentation of images of real or simulated objects (usually documents in a business).
Steps in a digital image processing system:
1) Input Stage- scanners are used to capture images or documents
2) A clerk uses a PC to retrieve the image of a source document
3) After a document has been input, additional processing may take place such as : data entry in specified fields on the document, retrieval and processing capabilities, linking of these items to an enterprise system
Digital Image Processing allows the use of much more complex algorithms for image processing, and hence can offer both more sophisticated performance at simple tasks, and the implementation of methods which would be impossible by analog means.
In particular, digital image processing is the only practical technology for:
· Classification - a system of coding and organizing materials according to their subject. A classification consists of tables of subject headings and classification schedules used to assign a class number to each item being classified, based on that item's subject.
· Feature extraction - a special form of dimensionality reduction. Applying a mapping of the multidimensional space into a space of fewer dimensions.
· Pattern recognition - to classify data (patterns) based on either a priori knowledge or on statistical information extracted from the patterns – which are usually groups of measurements or observations, defining points in an appropriate multidimensional space.
· Projection - The display of an image by devices such as: movie projector, video projector, overhead projector, or slide projector.
· Multi-scale signal analysis – the analysis, processing, amplification, interpretation and manipulation of signals. Signals of interest include sound, images, biological signals such as ECG, radar signals, and many others.
Narratives of the OE/S Process:
Write narratives for each of the models provided in chapter 10 starting with:
OE/S Process Context Diagram:
The Order Entry/Sales process begins with the customer placing an order, which updates the Inventory/Sales General Ledger. The customer then receives acknowledgement that their order has been received. The Billing/AR/CR department is notified of the customer's order through the receipt of a sales order notification. Once the order is shipped, the B/AR/CR department receives the Shipping's billing notification-- at this point the B/AR/CR process begins. The last part of this process is that the Carrier receives the completed packing slip and bill of lading.
OE/S Process Level-0 Diagram:
OE/S Process Level-1 (process 1) Diagram:
The inventory master data is accessed to check the availability of the items ordered. The marketing data is updated with items ordered. If the inventory is not available the items are placed on back order. If the inventory is no longer sold the systems rejects and removes those items from the order. The customer master data is accessed for the customer name, the sales order master data is accessed for the order total, and the accounts receivable is accessed to check the customer balance outstanding. If the order total takes the customer over their credit limit the order is rejected. If the customer has the available the order is accepte. The order is completed as a sale with the sales order master data updated for the accepted order, the picking ticket is created and sent to the complete the picking ticket process, a customer acknowledgement is sent, and B/AR/CR process is sent a sales order notification.
OE/S Process Level-1 (process 2) Diagram:
The picking ticket is matched to the good that will need to be pulled for shipment. Any discrepancies are rejected. The correct quantity is then pulled for shipment and is entered. The completed picking ticket is then moved to the next process of executing the shipping notice.
OE/S Process Level-1 (process 3) Diagram:
This process begins with the completed picking ticket being compared to sales order master data. If the picking ticket and master data do not match, the picking ticket is rejected. Matched sales orders are used to produce the shipping notice. The inventory master data is checked to ensure the inventory exists. Then the sales order master data as well as the inventory master data are updated to reflect the filled order. A bill of laden as well as a packing slip is created. The bill of ladden acts as a contract between the shipper and carrier while the packing slip identifies the customer and contents of the package. An inventory sales update is sent to the general ledger process to inform them of changes to inventory and cost of goods sold. Notification is sect to the billing process to notify them to begin billing.
OE/S System Flowchart:
The Customer places an order via phone. The sales orders are manually keyed in the customer service center. The Computer edits the customer order and records the sales order which updates the Enterprise Database. The Computer then generates an order entry screen display for the Customer Service Representative. The CSR reads the order number to the customer for order acknowledgement by the customer.
Once the Computer has edited the customer order and recorded the sales order, a picking ticket, with barcodes, is printed for the warehouse. The Warehouse Clerk manually picks the goods (per the picking ticket), records the quantity picked, compares the goods to the picking ticket, and initials the ticker. The completed picking ticket and picked goods are then manually delivered to the shipping department.
The Shipping Clerk scans the bar code on the picking ticket. The Computer generates a display of the sales order for the Warehouse Clerk to physically compare the order number to the pulled quantities. The Warehouse Clerk manually keys the acceptance of the order, and the computer records the shipment (which updates the enterprise database), prints the packing slip and bill of lading, and creates a display for the Warehouse Clerk to notify him that the shipment is accepted. The goods, along with the packing slip and bill of lading, are given to the Carrier for shipment to the Customer.
Describe the data structures from the ERD model provided in chapter 10:
Marketing data
Customer master data
Sales order master data
AR master data
Inventory master data
Micah's Horizontal View ( extremely abreviated. do not rely totally on)
1. Customer orders
2. sales ?s credit
3. credit informs sales
4. approve order
5. sales tells ship
6. sales tells B/AR/CR
7. Warehouse send pick tick to ship
8. ship ships and tells slaes
9. ship ships and tells GL
The Order Entry / Sales (OE/S) Process:
This chapter explores in detail the OE/S process. We will examine managerial decision making perspectives concerning this process; technologies available to support this process; and various models of this process (DFD's, ERD's, and system flowcharts). Finally the chapter will explore The Control Matrix for this process.Order Entry / Sales Process Activities:
Order Entry / Sales (OE/S) Process Information Flows: It is the first of the four steps in the order-to-cash process and reflects an interacting structure of people, equipment, methods, and controls that is designed to achieve certain goals. The primary function of the OE/S process is to create information flows that support the following:
1. Repetitive work routines of the sales order department, the credit department, and the shipping department. For example the sales order form often supports repetitve work routine of the sales order department by capturing vital customer and order data or by facilitating the process of granting credit to customers.
2. Decision needs of those who manage various sales and marketing functions.
The horizontal perspective of the Order Entry/Sales process is concerned with how the process relates to the repetitive work routines of the sales order, credit, and shipping departments.
The nine information flows are:
1- Customer places order
2- Sales order department requests credit approval from credit department
3- Credit department informs sales order department of disposition of credit request
4- Sales order department acknowledges order to the customer
5- Sales order department notifies shipping department of sales order
6- Sales order department notifies warehouse and B/AR/CR process of shipment
7- Warehouse sends completed picking ticket to shipping
8- Shipping department informs sales order department of shipment
9- Shipping department informs carrier, B/AR/CR process, and general ledger process of shipment
The vertical perspective of the Order Entry/Sales process is concerned with how the process relates to managerial decision making within the marketing function.
Vertical Information Flows: The flow of information between the operations processes and higher levels of management. The information flows "upward" in the heiarchy. The information at the management level is used for strategic decision making. An example of a vertical information flow associated with the OE/S process is when a sales manager uses an area code taken from a telephone orderto plan an advertising campaign.
Vertical Perspective of the OE/S Process:
Focus on the Customer
There has been expansion of the amount and type of data collected by the OE/S process regarding a firm's customer population. Mass marketing or segmented marketing is being replaced with more personalized marketing to a smaller segment. The ultimate aim is to concentrate on the individual customer, and the outcome is CRM software which is discussed below. Customers are the most important asset of a business. Global competition places more emphasis on the OE/S process.
Mastering Global E-business:
Data warehousing- viewed as focused on either operational or analytical applications:~ Operational applications: focus on providing decision makers with the information they need to monitor and control their organization.
~ Analytical applications: are intended to allow the use of sophisticated statistical and other analytical software to help an organization's members develop insights about customers, processes and markets.
- Includes Data Mining: Ex. Software is installed on a customer database that collects
data, encrypts it, and transfers it to its data center. The data is then cleaned,installed into a secure data warehouse, and a set of proprietary algorithms are used
to analyze it. Reports are then generated that tell its customers what works & what
doesn't on its web sites & can forecast future customer moves.
Link to a website that provides info on how to design, build, and maintain a data warehouse.
Data warehousing (alternate definition) - A data warehouse is a collection of data gathered and organized so that it can easily by analyzed, extracted, synthesized, and otherwise be used for the purposes of further understanding the data. It may be contrasted with data that is gathered to meet immediate business objectives such as order and payment transactions, although this data would also usually become part of a data warehouse.
Data marts- Subsets of an overall warehouse that are customized for a specific department. They are desgined to provide detailed data for a specific set of users while avoiding the costly development and extensive time delays that come from the development of a comprehensie data warehouse.
E-Business systems can be used to penetrate global markets by allowing trading partners and customers to easily process international orders without a physical presence. E-business systems are broken into categories: buy-side and sell-side.
~ Buy-side systems - use the internet to automate and manage corporate venders and purchases. The predominant technology in this area is electronic data interchange (EDI).
~ Sell-side systems - are designed to allow a company to market, sell, deliver, and service goods and services to customers throughout the world via the internet.
- One facet of sell-side systems is known as Customer Relationship Management (CRM) applications:
- Designed to manage all customer-related data (marketing, field service, contact management data)
- Segmentation of customers into categories based on key characteristics - ex. matches sales promotions to customers' buying trends
- Better Customer Service equals Happier Customers leading to Greater (repeat) Sales
This facilitates the matching of sales promotions with customers buying trends. This is a particularly crutial area for integration with an existing ERP system because much of the information necessary to support sales analyses comes from data captured during the recording of sales event data in the ERP system. "By combining enterprise systems with buy-side and sell-side applications, an organization can seamlessly conduct e-business across the globe." (text)Web Services, used to automate buy-side and sell-side enterprise applications:
Web Services - is a process and set of protocols for directly connecting enterprise systems over the Internet. Earlier Web protocols are presented by HTTP (HyperText Transfer Protocol), FTP (File Transfer Protocol), and SMTP (Simple Mail Transfer Protocol). Web Services goes one step further and enables communication between computer systems without human intervention. Web Services is, then, a replacement for EDI. But, it is much more in that it is a protocol for interoperation of systems, not just communication between systems. "By combining enterprise systems with buy-side and sell-side a
Web Services relies on three key underlying technologies:
1) Universal Description, Discovery, and Integration (UDDI) - a protocol for registering a business in an Internet directory so that companies can find one another and carry out business over the Web.UDDI website
- The UDDI project encourages the inter-operability and adoption of Web services.
- It is a partnership among industry and business leaders and was founded by IBM, Ariba, and Microsoft. Now, over 300 companies participate.
- UDDI provides a standards-based set of specifications for service description and discovery, as well as a set of Internet-based implementations.
- UDDI addresses a number of business problems by broadening and simplifying business-to-business (B2B) interaction.
- UDDI provides one-stop shopping for information on businesses and electronic services. Publishing business and service information in UDDI makes it broadly accessible to others.
>> 2) Web Service Description Language (WSDL) is an XML-based format for describing how one software system can connect and utilize the services of another software system over the Internet.
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- Figure: How WSDL works:
>> 3) Simple Object Access Protocol (SOAP) is an XML-based protocol for encoding Web Service messages.
- There are several different types of messaging patterns in SOAP, but by far the most common is the Remote Procedure Call (RPC) pattern, in which one network node (the client) sends a request message to another node (the server), and the server immediately sends a response message to the client. SOAP is the successor of XML-RPC, though it borrows its transport and interaction neutrality and the envelope/header/body from elsewhere, probably from WDDX.
>>
- Customer Relationship Management (CRM) Systems (recall from Chapter 2):
>> CRM software is designed to manage all the data related to customers, such as marketing, field service, and contract management data. CRM has become the focus of ERP vendors who realize the need to tap into this growing market and to integrate CRM data with the other data already residing within the ERP system's database.
>
- The concept behind CRM software is that better customer service means happier customers and yields greater sales.
- Part of the service concept is field-service support and contact management. The result is that sales person can review all the historical information before calling on a customer and be better prepared to provide that customer with targeted products and services. These systems also support the recording of information about the customer contact (spouse, children, hobbies, etc.), that help facilitate the salesperson in making quality contact with the customer.
>> At the same time, the software supports the organizing and retrieving of information of historical sales activities and promotional planning. This is particularly crucial area for integration with any existing ERP system because much of the information necessary to support sales analyses comes from data captured during the recording of sales event data in the ERP system.
A third area that is prevalent in CRMs is support for customer service - particularly for phone operators handling customer support call-in centers. The CRM quickly provides the phone operator with information on the customer's history and usually links the operator with a database of solutions for various problems about which a customer may be inquiring
Technical Considerations
The following factors need to be considered:
Scalability: the system should be highly scalable, as the volume of data stored in the system grows over time
1.Communication channels: CRM can interface with a variety of different channels (phone, WAP, Internet etc.)
2. Workflow - a company's business processes need to be represented by the system with the ability to track the individual stages and transfer information between steps
3. Assignment - the ability to assign requests, such as service requests, to a person or group.
4. Database - the means of storing customer data and histories (in a data warehouse)
5. Customer privacy considerations, such as data encryption and legislation.
Control Goals
The control goals for the OE/S proess are no different from the generic goals, except that they have been tailored to the specifics of the OE/S process.
There are two categories of goals:the operations process control goals and the information process control goals.
The operations process control goals are:
- Effectiveness of operations: provide timely response to customer inquiries; provide timely acknowledgment of customer orders; provide assurance of customer's creditworthiness; provide timely shipment of goods to customers.
- Efficient employment of resources: people and computers are the resources found in most business processes.
- Resource security - inventory, customer data are of concern to the OE/S process. Control plans should be in place to prevent theft or unauthorized sale of merchandise inventory. Equally important are plans designed to preclude unauthorized access to or copying, changing, selling or destruction of the customer master data.
The information process control goals are divided into two sections - one section for sales order inputs and a second section for shipping notice inputs. They are:
- Input validity. A valid sales order is one from an existing customer - one contained in the customer master data - whose current order falls within authorized credit limits. If a CSR enters a customer number for which the system has no record, the system rejects the order and the entry is terminated. To be added to the customer master data, a customer should pass an initial credit investigation. By adding the customer to the customer master data, management has provided auhtorization to do business with that customer. Valid shipping notice events are those that are supported by both an approved sales order and an actual shipment of goods.
- Input completeness and input accuracy of sales orders or shipping notices.
- Update completeness and update accuracy of the sales order and inventory master data. The sales order master data is updatd twice - once when a new sales order is created, and later to reflect the shipment of that order. The single inventory master data update occurs at the same time the new sales order is created.
Technologies Supporting OE/S Process:
- Data Warehousing - The use of information systems facilities to focus on the collection, organization, integration, and long-term storage of entity-wide data. Data warehousing provides users with easy access to large quantities of varied data from across the organization for the sole purpose of improving decision-making capabilities.
>* Data Marts - A subset of an overall data warehouse customized for a specific department. Data marts are designed to provide detailed data for a specific set of users.
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- Data Mining - The exploration, aggregation, and analysis of large quantities of varied data from across the organization to better understand an organization's business processes, trends within these processes, and potential opportunities to improve the effectiveness and / or efficiency of the organization.
>* Customer Relationship Management ([[../../Chapter2 GSH#CRM|CRM]]) Systems - Software that builds and maintains an organization's customer-related data. The concept behind CRM is that better customer service means happier customers and yields greater sales - particularly repeat sales. Parts of the service concept are field service support and contact management. Contact management facilitates the recording and storing of information related to each contact a salesperson has with a client and the context of the conversation or meeting. Additionally, each time the client makes contact regarding queries or service help, this information also is recorded. The result is that salesperson can review all the historical information before calling on a customer and be better prepared to provide that customer with targeted products and services. These systems also support the recording of information about the customer contact such as spouse's name, children, hobbies, etc., that help facilitate the salesperson in making quality contact with the customer. At the same time, the software supports the organizing and retreiving of information on historical sales activities and promotions planning. This facilitates the matching of sales promotions with customer's buying trends. This is a particularly crucial area for integration with any existing ERP system because much of the information necessary to support sales analyses comes from data captured during the recording of sales event data in the ERP system. The buzzword for this CRM application is "segmentation," the grouping of customers into categories based on key characteristics. These categories might represent customers likely to respond to a marketing campaign, high-end customers who should receive "high-touch" customer service, and low-end customers who should be directed to self- service options. A third area that is prevalent in CRMs is support for customer service-particularly for phone operators handling customer support call-in centers. For many organizations, phone operators who have never had previous contact with customers tend to handle the bulk of customer service activities. The CRM quickly provides the phone operator with information on the customer's history and usually links the operator with a database of solutions for various problems about which a customer may be inquiring. These solutions may simply be warranty or contract information, or at a more complex level, solutions to operations or maintenance problems on machinery or equipment. All this information can be efficiently stored for quick retrieval by the system's user.
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Digital Image Processing - computer based systems for capture, storage, retrieval, and presentation of images of real or simulated objects (usually documents in a business).
Steps in a digital image processing system:
1) Input Stage- scanners are used to capture images or documents
2) A clerk uses a PC to retrieve the image of a source document
3) After a document has been input, additional processing may take place such as : data entry in specified fields on the document, retrieval and processing capabilities, linking of these items to an enterprise system
Digital Image Processing allows the use of much more complex algorithms for image processing, and hence can offer both more sophisticated performance at simple tasks, and the implementation of methods which would be impossible by analog means.
In particular, digital image processing is the only practical technology for:
· Classification - a system of coding and organizing materials according to their subject. A classification consists of tables of subject headings and classification schedules used to assign a class number to each item being classified, based on that item's subject.
· Feature extraction - a special form of dimensionality reduction. Applying a mapping of the multidimensional space into a space of fewer dimensions.
· Pattern recognition - to classify data (patterns) based on either a priori knowledge or on statistical information extracted from the patterns – which are usually groups of measurements or observations, defining points in an appropriate multidimensional space.
· Projection - The display of an image by devices such as: movie projector, video projector, overhead projector, or slide projector.
· Multi-scale signal analysis – the analysis, processing, amplification, interpretation and manipulation of signals. Signals of interest include sound, images, biological signals such as ECG, radar signals, and many others.
Narratives of the OE/S Process:
OE/S Process Context Diagram:
The Order Entry/Sales process begins with the customer placing an order, which updates the Inventory/Sales General Ledger. The customer then receives acknowledgement that their order has been received. The Billing/AR/CR department is notified of the customer's order through the receipt of a sales order notification. Once the order is shipped, the B/AR/CR department receives the Shipping's billing notification-- at this point the B/AR/CR process begins. The last part of this process is that the Carrier receives the completed packing slip and bill of lading.
OE/S Process Level-0 Diagram:
OE/S Process Level-1 (process 1) Diagram:
The inventory master data is accessed to check the availability of the items ordered. The marketing data is updated with items ordered. If the inventory is not available the items are placed on back order. If the inventory is no longer sold the systems rejects and removes those items from the order. The customer master data is accessed for the customer name, the sales order master data is accessed for the order total, and the accounts receivable is accessed to check the customer balance outstanding. If the order total takes the customer over their credit limit the order is rejected. If the customer has the available the order is accepte. The order is completed as a sale with the sales order master data updated for the accepted order, the picking ticket is created and sent to the complete the picking ticket process, a customer acknowledgement is sent, and B/AR/CR process is sent a sales order notification.
OE/S Process Level-1 (process 2) Diagram:
The picking ticket is matched to the good that will need to be pulled for shipment. Any discrepancies are rejected. The correct quantity is then pulled for shipment and is entered. The completed picking ticket is then moved to the next process of executing the shipping notice.
OE/S Process Level-1 (process 3) Diagram:
This process begins with the completed picking ticket being compared to sales order master data. If the picking ticket and master data do not match, the picking ticket is rejected. Matched sales orders are used to produce the shipping notice. The inventory master data is checked to ensure the inventory exists. Then the sales order master data as well as the inventory master data are updated to reflect the filled order. A bill of laden as well as a packing slip is created. The bill of ladden acts as a contract between the shipper and carrier while the packing slip identifies the customer and contents of the package. An inventory sales update is sent to the general ledger process to inform them of changes to inventory and cost of goods sold. Notification is sect to the billing process to notify them to begin billing.
OE/S System Flowchart:
The Customer places an order via phone. The sales orders are manually keyed in the customer service center. The Computer edits the customer order and records the sales order which updates the Enterprise Database. The Computer then generates an order entry screen display for the Customer Service Representative. The CSR reads the order number to the customer for order acknowledgement by the customer.
Once the Computer has edited the customer order and recorded the sales order, a picking ticket, with barcodes, is printed for the warehouse. The Warehouse Clerk manually picks the goods (per the picking ticket), records the quantity picked, compares the goods to the picking ticket, and initials the ticker. The completed picking ticket and picked goods are then manually delivered to the shipping department.
The Shipping Clerk scans the bar code on the picking ticket. The Computer generates a display of the sales order for the Warehouse Clerk to physically compare the order number to the pulled quantities. The Warehouse Clerk manually keys the acceptance of the order, and the computer records the shipment (which updates the enterprise database), prints the packing slip and bill of lading, and creates a display for the Warehouse Clerk to notify him that the shipment is accepted. The goods, along with the packing slip and bill of lading, are given to the Carrier for shipment to the Customer.
Micah's Horizontal View ( extremely abreviated. do not rely totally on)
1. Customer orders
2. sales ?s credit
3. credit informs sales
4. approve order
5. sales tells ship
6. sales tells B/AR/CR
7. Warehouse send pick tick to ship
8. ship ships and tells slaes
9. ship ships and tells GL